The Friedkin Group are reportedly in discussions with JP Morgan Chase & Co. over raising £300m of debt
New Everton owners, The Friedkin Group (TFG), are looking to complete a deal that could save the Toffees millions per year in interest repayments. TFG are reportedly in discussions with New York-based banking giant JP Morgan Chase & Co. over a debt refinancing package for the new stadium.
The move, reported by Bloomberg on Tuesday, was first mooted in early December as TFG moved towards completion on their takeover of Everton, acquiring the 94.1% shareholding that was held by previous owner Farhad Moshiri on December 19.
Bloomberg report that TFG have engaged the services of JP Morgan to seek out institutional investors as Everton seeks to raise some £300m of debt to support a refinancing of the new stadium build at Bramley-Moore Dock, a 52,888-seater venue that the Toffees will move into from the start of next season, bringing an end to their 133 years at Goodison Park.
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The report also claims that JP Morgan have, separately, provided TFG and Everton with a loan of some £130m. TFG representatives declined to comment when approached by the ECHO.
Such a move to refinance the debt attributed to the stadium was widely expected, with TFG able to access more favourable lines of credit that would enable them to reduce interest payments on the stadium, positively impacting the club’s balance sheet. Debt raised from US private equity has also been used by the likes of Tottenham Hotspur in relation to their new home, which they moved into in 2019.
One of the first major tasks for TFG has been, and continues to be, tidying up the debt that the club held via various lenders, with some already paid off.
Firms such as Rights and Media Funding Limited, to which the club had paid out some £30m in interest on a loan of £225m during the life of the borrowing, according to The Guardian in April 2024, had been charging a higher rate of interest, and as the club’s options to raise capital became more challenging in the face of financial struggle, the ability to get favourable rates also became more difficult, hence the reason the club turned to the long-doomed 777 Partners.
But now, with TFG focusing on the club being far more efficient financially, the reduction of a few percentage points in interest could end up saving the club between £5m and £10m per year, and for a club that has had to be mindful of every penny due to PSR concerns, such a development is an undeniable positive and an early sign of moves in the right direction for the club.
The stadium will be a huge asset to Everton, something recognised by TFG. The increased capacity will likely add a further £10m-plus onto matchday revenue through increased ticket sales will also help drive forward commercial revenues through greater opportunities for partner visibility, not to mention the sale of stadium naming rights and the money on offer from hosting events away from football, such as music concerts.
Key to the timeframe over its success will be the club ensuring that they are Premier League members come the start of next season, with the on-pitch struggles this campaign seeing Everton sit two places and one point above the drop zone with a game in hand on their rivals.
